Western Canada Oil and Gas Plays:

Then and Now

Meridee Fockler, B.Eng (Geol), P.Geol
Technical Analysis Director

November 3, 2016
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 Outline

Historical Prices and Activity

2014 vs 2016 Crown Land Sale Comparison
2014 vs 2016 Completions Comparison
2014 Q1 vs 2016 Q1 Production Comparison
Hot Plays
Other Activity
Wrap Up
 WCSB Plays: Hz Wells 2005+
Horn River

Montney
Charlie Lake
Oil Sands
Dunvegan

Mannville
Thermal Oil
Montney
Duvernay Viking

Spirit River Cardium Mannville

Heavy Oil

Viking
Glauconitic
Ellerslie Williston
Basin

Shaunavon
Bakken/Torquay Midale
 Historical
19942016 Oil Price and Vertical vs Horizontal Spuds

Vertical

Horizontal

Deviated

Powered by IHS Data; US EIA website

2014 vs 2016 Crown Land Sales
 Crown Land Sale Activity
2014 Price/Ha

Beg

Gundy
Max $/Ha ~ $18,000
Kakwa Kaybob

Lloydminster
Edson

Brazeau R
Ferrier Provost

Steelman
Pinto

Powered by IHS Data Quarterly Crown Land Sale Analysis September 28, 2016
 Crown Land Sale Activity
Jan to Oct, 12 2016 Price/Ha and Postings

Oak

Max $/Ha ~ $8,000

Kakwa

Edson Lloydminster

Brazeau R
Ferrier Provost
East Shale Basin
Michichi

Elswick Daly

Powered by IHS Data Quarterly Crown Land Sale Analysis August 25, 2016
 Crown Land Sale Activity
2014 vs Most of 2016 Total Bonus

69%

97%

93%

76%
2014 vs 2016 Completions
 Resource Play Completions Metrics
2014 and 2016: One Year Avg
Average Stages, Measured Depth and Completed Length per Well
2016
2014

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 25, 2014; September 22, 2016
 Resource Play Completions Metrics
2014 and 2016: One Year Avg
Technology Group Distribution
2016
2014

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 25, 2014; September 22, 2016
 Resource Play Completions Metrics
2014 and 2016: One Year Avg
2016 Base Fluid Distribution
2014

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 25, 2014; September 22, 2016
 Resource Play Completions Metrics
2014 and 2016: One Year Avg
Average Fluid and Proppant per Well
4,060 35,640
2016

27,500 79,500
2014

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 25, 2014; September 22, 2016
 Resource Play Completions Metrics
2014 and 2016: One Year Avg
Average D&C Costs per Well
2016
2014

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 25, 2014; September 22, 2016
Q1 2014 vs Q1 2016 Production
 3-Mo Cum Prod
Horn River Wells On-Stream in Q1 2014

Montney

Charlie Lk Oil Sands

Dunvegan
Mannville
Montney Thermal Oil
Duvernay Viking

Spirit River
Cardium Mannville
Heavy Oil

Viking
Williston
Basin
Glauconitic
Ellerslie
Shaunavon
Bakken/Torquay
Midale
 3-Mo Cum Prod
Horn River Wells On-Stream in Q1 2016

Montney

Charlie Lk Oil Sands

Dunvegan
Mannville
Montney Thermal Oil
Duvernay Viking

Spirit River
Cardium Mannville
Heavy Oil

Viking
Williston
Basin
Glauconitic
Ellerslie
Shaunavon
Bakken/Torquay
Midale
 Production and Well Count by Formation
3-Mo Cum Prod: Wells On-Stream Q1 2014 & 2016

8 Cardium
4 Viking
1 Spirit River

3 McMurray

2 Montney

5 Duvernay

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 Production and Well Count by Formation
IP90 Median Rate: Wells On-Stream Q1 2014 & 2016

9 Cardium
25 Viking
2 Spirit River

5 Glauconitic

1 Halfway/Doig
3 Montney

4 Duvernay

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Hot Plays
 Lwr Cret Spirit River Resource Gas Play
Horn River

Montney

Oil Sands

Montney
Duvernay Viking

Cardium
Spirit River Heavy Oil
Spirit River
Cardium

Viking
Williston
Basin

Bakken/Torquay
Midale
 Spirit River
Play Development

More Marine

Kakwa

Highest Rates
Sundance
Edson
Marsh

Ansell

Play has Moved Downdip; Morningside

Focused on Sweet Spots Ferrier
Brazeau

More Continental

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 Spirit River
Spirit River Gas Completions Trends
Avg Stages, Measured Depth and
Completed Length per Well Avg Proppant and Fluid per Well

14 4,400

1,500 Stages 800 3,800

Length
Technology Group Distribution
Proppant Avg D&C Costs per Well
Cost

$2.9MM
$1.3MM

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 22, 2016
 Spirit River
Notikewin at Marsh
Marsh Location Map Spirit River Cross-Section

9.0 mmcf/d
19.4 mmcf/d

9.2 mmcf/d Notikewin

12.5 mmcf/d

Falher

5.1 mmcf/d 15.3 mmcf/d

Wilrich
Spirit River IPmax by Member

Digest Significant Well June 23, 2016

 Spirit River
Play Extends to Morningside
Lower Falher Channel Sands Development Channel Development Cross-Section
B B'

Notikewin

Falher

Wilrich

Map generated by IHS Energy Accumap; Powered by IHS Data Significant Well February 25, 2016
 Spirit River
Pros and Cons
5-23-57-1W6
Pros
Pay ~120m
Stacked sands
Highest IP rates in Basin
Cons
Variable liquids rates
Geological complexity
Costs
Avg D&C Cost$4.2MM

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 Lwr Triassic Montney Resource Play
Horn River

Montney
Montney

Oil Sands

Montney
Duvernay Viking

Cardium
Spirit River
Heavy Oil

Cardium

Viking
Williston
Basin

Bakken/Torquay
Midale
 Montney
Play Development

Laprise

Town
Tower/Parkland

Altares

Liquids-Rich Dawson
Girouxville
Gas
Swan
Oil Along Subcrop
Elmworth

Karr
Kakwa Ante Creek

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 Montney
Montney Gas Completions Trends
Avg Stages, Measured Depth and
Completed Length per Well Avg Proppant and Fluid per Well

30

4,800 2,000 Stages 2,600 16,000

Length
Technology Group Distribution
Proppant Avg D&C Costs per Well
Cost

$3.5MM
$1.9MM

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 22, 2016
 Montney
No Inhibitions about Imbibition
Percentage Fluid Recovered Effective Water Saturation Pressure Gradient

LPDB

Turbidites

Desiccated
HPDB

% Fluid Recovered vs Frac Fluid Type % Fluid Recovered vs Pressure Gradient

Low
High Viscosity
Viscosity

Mod Sw Low Sw V. Low Sw

Mod P/D Mod Sw High P/D Low Sw V. High P/D Desiccated
Exploration Review October 20, 2016
 Montney
Laprise: A Billion Dollars of Value
Montney TVD Beg/Laprise/Martin Stratigraphic Cross-Section

L. Doig Sltst

U. Montney

M. Montney

L. Montney

Montney Hz Well EUR

Saguaros lands are an extension of

Progresss play at Beg and Jedney
Shallowerless expensive to drill
Overpressured
Liquids-rich
Saguaros wells ~2,000m Hz length
50+ stages

133 mmboe proved + probable reserves

~150 locations
Spark Activity Review September 14, 2016
 Montney
Pros and Cons
15-25-80-16W6
Pros
Pay ~300m
Potential for vertically
stacked laterals
High rates
Cons
Reservoir heterogeneity
Variable liquids content
Costs
Avg D&C Cost$5.4MM

Log analysis generated with GeoLog Multimin Software; Powered by IHS Data
 Lwr Cret Viking Resource Oil Play
Horn River
Dodsland

Montney

Oil Sands

Montney
Duvernay Viking

Cardium Viking
Spirit River
Heavy Oil

Cardium

Viking
Williston
Basin

Bakken/Torquay
Midale
 Viking
Play Development

Downspacing to
Halkirk
32 wells/section
East

Kerrobert

Provost

Most Active Dodsland Totnes

Saskatchewan

Elrose
Plato
Alberta

Forgan

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 Viking
Viking Oil Completions Trends
Avg Stages, Measured Depth and
Completed Length per Well Avg Proppant and Fluid per Well

19

1,500 760 Stages 260 560

Length
Technology Group Distribution
Proppant Avg D&C Costs per Well
Cost

$0.2MM $0.3MM

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 22, 2016
 Viking
Viking Fracs: Best Served Hot
Viking Dodsland: Frac Fluid Temperature Distribution Type Curves by Frac Fluid Temperature

45C (Hot Frac)

45C (Regular Frac)

Frac Fluid Temperature and 6-Mo Cum Distribution Cumulative Production by Frac Fluid Temperature

Hot frac cums are 32%

higher after 12 months

Spark Activity Review February 3, 2016

 Viking
Pros and Cons
3-23-31-21W3
Pros
Large areal extent
Lowest cost play WCSB
Most active play WCSB
Cons
Pay 510m
Costs
Avg D&C Cost$0.5MM

Log analysis generated with GeoLog Multimin Software; Powered by IHS Data
 Up Dev Duvernay LR Gas Resource Play
Horn River

Montney

Montney Duvernay
A Duvernay Viking

Cardium
Spirit River
Heavy Oil

Cardium

Viking
Williston
Basin

Bakken/Torquay
Midale
 Duvernay
Play Development

Phase Windows Variable

Kaybob
Geomechanics
Drilling Problems

Edson

Recent Crown
Land Sale Activity
Willesden Green
East Shale Basin

Powered by IHS Data

 Duvernay
Duvernay Gas Completions Trends
Avg Stages, Measured Depth and
Completed Length per Well Avg Proppant and Fluid per Well

30

5,700

2,300 Stages 4,600 36,700

Length
Technology Group Distribution
Proppant Avg D&C Costs per Well
Cost

$5.1MM $4.5MM

Data from Canadian Discovery's Well Completions & Frac Database Quarterly Completions Analysis September 22, 2016
 Duvernay
Kaybob/Willesden Green Initial Rates
Duvernay Location Map Greater Kaybob IPmax Gas Rate by Basin

Will G Avg 1.3 mmcf/d

Gtr Kaybob Avg 2.0 mmcf/d

C
B
A

Willesden Green IPmax Gas Rate Chronology

2.2 mmcf/d
1.4 mmcf/d
C B
A

East Shale Basin IPmax Condensate Rate Chronology

165 bcpd

C
B A

Spark Activity Review March 30, 2016

 Duvernay
Pros and Cons
16-4-62-21W5
Pros
Developing play, still
experimenting
Net Pay up to 60m
Cons
Phase window variable
Geomechanics, drilling
problems
Capital Intensive
Costs
Avg D&C Cost$9.6MM

Log Analysis generated with Geolog Multimin Software, Powered by IHS Data Significant Well September 25, 2014
Other Plays
 Notable Six-Month Activity & Results

Horn River

Keg River
Montney
Doig Oil Sands
Dunvegan
Duvernay
Mannville Regional Articles

Spirit River Heavy Oil

Cardium

Banff
Viking
Glauconitic
Ellerslie Frobisher Bakken/Torquay
Ratcliffe
Exshaw/Bakken
MIdale
Shaunavon
 McLaren
McLaren Channel SAGD Development

GR Neut/Dens

Channel incises regional Mannville facies

High quality channel reservoir
Up to 18m thick
30% porosity
10,000 mD perm
12 API oil responds well to SAGD process
within high quality reservoir

Powered by IHS Data Activity Review January 6, 2016

 Mannville
Traversing Conventional to Unconventional Plays
Med R CoalBanff Isopach
EllerslieConventional Reservoir A
Porosity 1220% and permeability up to 1,000 mD
Infilled lows on pre-Cretaceous unconformity
Hydrocarbons trapped stratigraphically by pinch-out
Upper Mannville Lithic ChannelsUnconventional
Reservoir
Also in structural low IPmax can be impressive
Stratigraphic trapping within channel sand facies U Mann Lithicup to 427 boepd
A Ellerslieup to 322 boepd
Mannville Structural Cross-Section

Spark Activity Review July 6, 2016

 McMurray
CNRLs Kirby South SAGD Project
Kirby South Drainage Areas T73, R7W4 AA/3-29-73-7W4 Well Log Suite

IPmax 1,127 605

Marine
Porosity 32.8% 34.2%
Pay 28.9 21.0

Tidal Flat

Estuarine

Fluvial-Wet

AA/3-29-73-7W4 Well Log Suite

CNRL McMurray and Wabiskaw SAGD project
Divided into 7 drainage areas
McMurray has exceptional reservoir
characteristics

Digest Significant Well May 26, 2016

 Charlie Lake
Resource Oil Development

Significant Well October 22, 2015

Map generated by IHS Energy AccuMap; Log analysis generated with GeoLog Multimin Software; Powered by IHS Data Activity Review September 30, 2015
 Charlie Lake
Promising Development at Boundary Lake
Charlie Lake Oil Recovery at Boundary Lake Charlie Lake Structural Cross-Section

Boundary Lake Member

Permeable, oil-filled
reservoir surrounded
by tight lime mud
Whitecap targeting
unswept portion of
pool
Potential 100 mmbbls
new oil in play

Spark Activity Review April 13, 2016

 SE Saskatchewan Mississippian Subcrops
Active and Economic
Mississippian Subcrops RR Map 31/8-36-4-6-W2 Well Logs

NE
12-6-5-5W2
On production July 2016
168 bopd

Queensdale

Wordsworth

Steelman

8-36-4-6W2
SW Pinto Northgate
Torquay Winmore

Mississippian Subcrops Schematic Cross-Section

Digest Significant Well October 20, 2016

 Besa River
A Biggie in the Liard Basin
Liard Basin Location Map Upper Devonian Schematic Cross-Section

IPmax 56 mmcf/d
5-Mo Cum 5.3 bcf

Chevron Woodside La Jolie b-3-K

RR Sept 2015 Large Frac Huge Patry Shale Resource
IPmax 56 mmcf/d Completed Length2,143m NEB estimate219 tcf
5-Mo Cum 5.3 bcf 19 Stages 2nd to Montney449 tcf
95,000 m3 slickwater
5,600t proppant
Digest Significant Well August 25, 2016
Wrap Up
 Wrap Up
2014 vs 2016 Play Comparison

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 Wrap Up
2014 vs 2016 Crown Land Sales and Completions

Crown Land Sales in 2016

Activity, Price/Ha and Total Bonus way down
Completions in 2016
Measured Depth and Completed Length up
Stages way up
Proppant Tonnages, Frac Fluid Volumes up
Drilling and Completions Costs way down
Oil Price
Rebounding
 Max Calendar Day Rate
Per Section (boepd)
Thank you to other contributors
Pearl Meyer ppt maestro
Candace Keeler cartographer
Svetlana Suvorova graphic designer
Paul Patton infographic
Zenith Phillips graphic designer
Joshua Lee EURs
Luigi Malinis completions
Ricky La completions
Ben McKenzie data maestro

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